Petards reports return to operating profits as orders for rail and defence tech increase

Bosses expect full year results to be significantly better than 2025

Surveillance and security tech maker Petards has returned to operating profit and with a larger order book.

The manufacturer of CCTV systems for trains, communications systems for the defence sector and automatic numberplate recognition technology has reported a small half-year operating profit of £14,000 in the six months to the end of June – its first operating level profit since 2022. Bosses said delivery of higher margin work was responsible for the progress with stronger orders coming from rail and defence customers.

Petards’ order book at the end of June was £9.6m, up from £9.2m at the end of December, and supplemented with £700,000 of rail orders announced by the London Stock Exchange-listed firm in August. Revenues for the half year were slightly lower at £7.7m, compared to £7.9m in the same period last year.

But cash generation increased to £894,000, from £860,000. That led to reduction in net debt to £1.15m from £1.33m at the end of last year.

The firm runs its main rail sector factory at Team Valley, Gateshead. That division saw improved trading in the second half of 2025 and into the first half of this year with more orders and higher activity levels.

In H1 2026, total orders in the rail business were at a level not seen in more than five years. They included a £500,000 contract for retrofitting eyeTrain systems – used to detect track debris, to investigate incidents, for operational monitoring and for passenger security.

Meanwhile defence revenues were helped by the start of work on a £2.2m order from military vehicles maker Rheinmetall BAE Systems, for engineering design work on the Challenger 3 tank. And the group’s QRO business which makes automatic number plate readers was said to have rebounded in the first half following a weaker performance at the end of 2025.

Raschid Abdullah, chairman of Petards, said: “The upward trend in the group’s trading performance has continued into 2026, particularly in rail and defence where order intake has seen improvements over that of recent years. This in turn has driven greater operational efficiencies in those areas and improvements in gross profit margin.

“This has led to the order book at June 30, 2026 increasing to £9.6m (December 31, 2025: £9.2m) which has been supplemented by the further rail orders announced in August. We expect the group to continue to generate cash in the second half, and for a further reduction in net debt by the year end.

“The board remains confident that the group will perform well over the remainder of the year, and with the benefit of its current order book, it expects to deliver another significant improvement in its results over those achieved in 2025.”